So it was alarming when India’s Ministry of Home Affairs last month placed the foundation, which has made $500 million in grants to organizations in India since 1952, on a national security watch list. That means it cannot give money to Indian groups without permission from Prime Minister Narendra Modi’s government. The move shook the donor community and triggered fears of a broader crackdown on civic activism — fears quickly realized when the government canceled the registration of nearly 9,000 foreign-funded civic and nongovernmental groups.

The Ford case smacks of political payback. The listing stems from a complaint by the Gujurat State government about the Sabrang Trust, a private group that has received grants from Ford. The trust, its founder, Teesta Setalvad, and her husband have worked on behalf of victims of sectarian riots in Gujarat in 2002, when Mr. Modi was chief minister. They have also sought to bring charges against Mr. Modi for enabling the violence, which left more than 1,000 people dead.

The state asked the ministry to investigate the trust for “disturbing the communal harmony here and carrying out anti-national propaganda against India in foreign countries.” The state had previously accused Ms. Setalvad and her husband of embezzling funds meant for a museum to honor the riot victims. Their advocates say they are victims of a political vendetta. One Indian official has described Ford and Greenpeace, which is now facing closure in India, as “agents of Western strategic interests.” Although democratic India is a far cry from Russia, China and Egypt, similarly chilling talk was heard when authoritarian leaders in those countries moved to crush civic activism.

Mr. Modi has an ambitious agenda to lift millions of people out of poverty and play a bigger role on the world stage. He almost certainly cannot attract the investment he needs while imposing a repressive social order and devaluing India’s greatest asset, a robust democracy.

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